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Whatever may have been Mr. Belilios's understanding at the time, the position he subsequently took up was that he understood he had placed the work in the hands of the Government, that it was under the direction of the Public Works Department acting through their agent Mr. Chatham, and that he was only liable to the extent of an estimate made by Mr. Danby.
Mr. Chatham on the other hand states that he informed Mr. Belilios that he would not be bound by the estimate which Mr. Danby had prepared, and Mr. Belilios gave him "carte blanche". Mr. Belilios has admitted using these words but stated that he intended them to apply to the method of carrying out the work.
On November 18th, Mr. Chatham wrote to Mr. Belilios informing him that he had instructed the Government Contractor to make the alterations and repairs. Mr. Belilios therefore was aware of the fact that Mr. Danby, who had sent him the original estimate, was no longer being employed, and knew that the repairs, which he had undertaken to pay for, might come to more than Mr. Danby had estimated.
Early in 1898 the Government Contractor, A-Hok, went to Mr. Belilios with a certificate from Mr. Chatham authorising him to apply for payment of $6,500. This was slightly in excess of the original estimate but Mr. Belilios paid the amount to A-Hok. The certificate bore on the face of it that it was a payment "on account", but Mr. Belilios has since stated that he believed he was then paying the greater part, if...